IVCA Profile: The 2013 Venture Capital Portfolio Company of the Year, Gogo InFlight Internet

IVCA Profile: The 2013 Venture Capital Portfolio Company of the Year, Gogo InFlight Internet

December 4, 2013

The final honoree profile, in anticipation of the 2013 IVCA Annual Awards Dinner on December 9th, is for the Venture Capital Portfolio Company of the Year, Gogo® InFlight Internet. Since 2008, this innovative service has provided internet service on several airlines, providing a link to productivity and online access for their users. As commented upon below, Venture Capital investments were crucial to getting this successful venture “off the ground.”

The IVCA posed some questions to Gogo – as represented through their media department – as it describes the relationship between their entrepreneurship and VC investments.

IVCA: Congratulations on being the 2013 Venture Capital Portfolio Company of the Year, to be recognized at the IVCA Awards Dinner on December 9th. What are the origins of your company, and what service do you offer the marketplace?

Gogo:  Gogo is the global leader of in-flight connectivity and wireless in-flight digital entertainment solutions. Using Gogo's exclusive products and services, passengers with Wi-Fi enabled devices can get online on more than 2,000 Gogo equipped commercial aircraft that cover more than 7,000 flights a day. Our airline partners include American Airlines, Air Canada, AirTran Airways, Alaska Airlines, Delta Air Lines, Japan Airlines, United Airlines, US Airways and Virgin America.

In addition to its commercial airline business, Gogo has more than 6,500 business aircraft outfitted with its communications services. Those services include voice and internet services using both satellite and ATG networks.

Gogo’s origins date back to 1991, when a group of entrepreneurs created the company’s vision to provide connectivity services for private aircraft. In October of 2006, Gogo won an FCC auction for an exclusive license to provide connectivity for the aviation industry using an air-to-ground (ATG) technology. 

After winning the auction, Gogo built out a network of 92 cell sites in record time and launched the service in August of 2008. Last year, Gogo also solidified a global satellite-based connectivity network. Gogo’s suite of technology solutions now includes ATG, satellite-based connectivity and hybrid satellite/ATG solutions for both the business and commercial aviation markets.  Gogo is the only provider with such a broad array of technology solutions.

In addition to connectivity and in-flight entertainment, Gogo’s multi-media in air platform offers advertisers and e-commerce partners unique access to a highly captive and undistracted audience. Gogo also offers operations oriented communication services to its airline partners.

In September, Gogo launched its ground-breaking new service - Gogo Text & Talk - that allows passengers to send and receive voice calls and text messages using their own devices. The service is currently available for our business aviation customers. In 2014, Gogo is planning to launch the text messaging service for commercial aviation.

IVCA:  As the award recipient, can you describe how Venture Capital was crucial in the development and implementation of the Gogo service?

Gogo: Venture Capital and Private Equity investments were crucial in providing the funding needed for the spectrum acquisition, build-out of the network, technology design, and necessary regulatory approvals to launch the service in 2008. VC and PE investments totaled over $600 million since 2006.

IVCA: Since you are providers for the internet in the air, how has your service been a game changer for the travelers and business, in your opinion?

Gogo: Gogo’s broadband connectivity service transformed the flying experience forever when we launched the service in 2008 for our commercial aviation market and in 2009 for our business aviation market. Connectivity is a must have service now for air travelers in the US. We have stories of people switching flights just to get on a Gogo-connected flight to be more productive. On the business aviation side, our broadband connectivity solutions have seen record adoption levels.  In just four years, the service is now available on more than 1,800 business aircraft.

IVCA: How were you able to develop relationships with the various air carriers that are your clients, and how did you help them to make the transition to provide the internet experience on their airlines?

Gogo: When Gogo launched its ATG technology, the airline industry was going through a recession. The economic recession of 2007-08, high oil prices, airline bankruptcies & consolidation, and capacity reductions created an environment where airlines were not necessarily focused on connectivity solutions for their passengers.. Gogo was the first, and remains the only provider of an end-to-end turnkey connectivity solution for the airlines. In addition, Gogo effectively financed the equipment costs for some of the earlier airline contracts. Access to Venture Capital and Private Equity capital enabled the company to offer such contract terms. This was critical to quickly gain market share and reach scale.

Since 2008, we have grown our relationships with our airline partners. In some cases, we started with just mainline fleets and then added regional jet fleets and international fleets. This highlights Gogo’s ability to provide connectivity solutions to various types of aircraft and enable an airline to have full fleet, seamless coverage, which is very important to an airline. Gogo takes pride in its service availability and reliability and constantly strives to provide more bandwidth to the aircraft. Gogo is also a pioneer and innovator. Since its launch in 2008, we have introduced ‘Gogo Vision’ and ‘Gogo Text & Talk’ for passengers and increased our connectivity technologies portfolio to address the aviation industry needs globally. Our airline partners recognize the value of the turnkey solution Gogo offers.

IVCA: How would you describe your corporate environment? Are there distinct climate differences between your offices in Illinois and Colorado?

Gogo: Our corporate environment is focused on innovation and customer service in both offices in Illinois and Colorado. Gogo has a great technology sharing process between the divisions, which is critical. With technology and IT resources comprising more than a third of our workforce, we are able to bring the latest cutting edge technologies and products to both markets.

IVCA: As an evolving entity with technology, what new products or services is the company anticipating rolling out in 2014 or beyond?

Gogo:  Gogo expects to launch its Text messaging product in commercial aviation in 2014 and the continued rollout of its Gogo Vision service. Gogo also expects to launch service on international flights for Delta and Japan Airlines in 2014.

IVCA: How does Gogo give back to the community? What type of organizations does the company focus on in their give-backs?

Gogo: Two we have supported over the past few years are Leadership Greater Chicago – which develops young leaders in the Chicago area – and Access Living, which advocates for and provides independent living services to those with disabilities. 

IVCA: What does the Portfolio Company of the Year honor mean to Gogo?

Gogo: Gogo is honored to receive the award from the IVCA. Venture capital is a critical source of funds for small and medium sized businesses which help bring innovation to various industries. Gogo thanks the IVCA for recognizing Gogo and will look forward to continue to bring innovation and cutting edge technology solutions to the aviation industry.

The 2013 IVCA Awards Dinner, presented by Kirkland and Ellis LLP, will take place on December 9th, 2013, at The Four Seasons, 120 E. Delaware Street, Chicago. For information, click here.

For more information about Gogo Inflight Internet, click here.